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Sticking to the plan and resisting buying into market dips?
I started investing late last year at 31, with a goal of investing around $4000 consistently each year, but putting in lump sums when bear market hits. So in April, i invested about $50,000.
However, when market underwent correction (recent one), i had the urge to put money into indexes - another 3k or so. How does one control the temptation to do so? There is a voice in my head saying i dont need the other 70k pile of cash in the bank losing value. 12 month emergency savings should be $24k.
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Hi, Ridhwan, you did excellently, as you did.
You have to stay course come what may.
And yes, you could DCA the non-emergency funds over the next 12 months, f.ex. quarterly. It makes no sense to have a 'war chest' as some recommend, because we never can know the crashes or corrections and so we would miss out a lot of positive returns. Just do it the boring and simple way: steady and with equanimity.
Besides of avoiding high fees and being very patient, however, the most
important issue of investing is proper asset allocation.